Against false impressions. The Lamy-Patten paper in anticipation of Thursday's Euro-American Summit obviously has a priority goal: prove that co-operation between the EU and the United States exists and is serious and colossal, so as to counter the false impressions resulting from the way certain differences, especially in the trade sector, are presented by the media and perceived by the public. As soon as a difference looms, it is inflated out of all proportion and takes on the aspect and appearance of a conflict. The concern with wanting to prove the solidarity and consistency of the partnership is, moreover, common to both sides (see our bulletin of 27 April, pp. 8/9).
Pascal Lamy and Chris Patten are no doubt right when they underpin that even the most heated of differences, such a over steel, only cover a minimum percentage of reciprocal trade. But they have also to recognise that the perception the public have of conflict in relations between the two sides of the Atlantic is not only based on trade disputes but also on more political aspects, such as the American attitude to the Kyoto Protocol and disarmament. The two Commissioners do not conceal the fact that their efforts are also aimed at other members of the Commission, who all, at some time or another, have had occasion to go to the United States and must have a comprehensive outlook of the situation, even when their talks with the American authorities have a sectoral nature. This didactic aspect towards their colleagues is warming; the two authors are possibly aware that it some cases it is justified…They have even drawn up a summary for the attention of Commissioners "who may not have the time nor the desire to read the whole" of the text.
A well nourished list of initiatives. The Lamy-Patten paper recalls some obvious facts (the EU and the United States represent over half the world's economy and 40% of world trade) and some truths, that are less so: for example, the fact that the Euro-American institutional consultation framework is in place and working well at different levels, to begin with the ministerial level, even though it needs constantly updating and improving. Most of the document, however, concerns the description of what already exists and its significance, and, even more so, indications of what would need doing to consolidate this "essential" partnership for Europe and for the world. The list of economic areas that could be included in a new "Euro-American Agenda" essentially comprises:
1. The creation of a common transatlantic airspace. This initiative presupposes that the European Court of Justice decides on the EU's competency in this field, denying Member States the right to conclude national "open skies" agreements. Alongside liberalisation, the transatlantic airspace could comprise a convergence of environmental, competition and security rules.
2. Reciprocal freedom of access to stock markets ( the American attitude which was previously very restrictive, has recently shown signs of openness) and co-operation in accountancy standards (become a priority since the Enron affair).
3. Electronic systems of customs procedures. A basis for Euro-American co-operation already exists in the framework of the WTO in view of the definition of multilateral instruments.
4. The protection of intellectual property at transatlantic level. For trademarks, nothing opposes a common system, as long as some alignment is carried out. For patents, it is essential that the United States agrees to the principle of "first-to-file" (like Europe and the rest of the world) instead of the "first-to-invent" principle, that the Americans alone practice.
5. Co-operation in matters of regulation, which needs intensifying. A joint project of "guidelines" is being prepared.
6. Standards for organic farming and their control. The two parties should work in view of mutual recognition of their respective standards, if they want to avoid the obligation of product-by-product recognition.
7. Administrative co-operation in the field of the tax on savings. The United States (alongside Switzerland, Monaco, Andorra, Liechtenstein and San Marino) is on the list of countries with which the Commission has already been authorised to negotiate. The aim is to co-operate on both a bilateral level and in the framework of the WTO in view of enhanced international co-operation.
8. "The transatlantic procurement government markets". Current opportunities are not insignificant but should be completed by an electronic system of tendering and by greater access to market information, particularly by expanding access to parts of the market where there are still restrictions (certain areas of services and the US defence industry, certain areas of EU public works) and the number of areas excluded from liberalisation should be reduced, like some Federal States and towns in the USA. It wouldn't be realistic, however, to imagine the USA renouncing within a foreseeable time-scale, the totality of their "Buy American" legislation, despite some recent moves in this direction.
9. Reduction of subsidies in key industrial sectors. The definition of clear, multi-lateral and bi-lateral rules would contribute to reducing the risk of trade disputes in sectors such as steel and aeronautics.
10. Joint strategies for making anti-AIDS, tuberculosis and other contagious diseases drugs available to developing countries, particularly Africa. Co-operation already exists but should be re-launched and strengthened.
Other fields for further co-operation. Other more general areas could also be explored if the political ambition is there for joint and co-ordinated initiatives. The document points to strengthening multi-lateral instruments against the proliferation of arms of mass destruction; legal co-operation (progress by the EU Justice and Home Affairs Council have been encouraging (see EUROPE 27 April page 10), energy (contacts are being set up, and co-operation on the oil markets could become a very significant aspect of the partnership), sustainable development (the concept is in theory recognised by both sides but the application of the modalities of co-operation are still to be explored, environmental labelling (beyond the indications on energy returns from office equipment already in force). It is, nevertheless, necessary to rapidly proceed to negotiating the areas connected to the European decision to carry out the Galileo satellite navigation system, namely, the interoperability between the EU and US systems, frequency and security and access to space (the issues of overcapacity world wide).
Managing divergences. The Lamy/Patten document stresses that it is logical that the EU and the USA, in parallel to new initiatives, manage with moderation and wisdom, the divergences and differences that will unavoidably arise in the trade arena, due to the intensity of reciprocal trade. These differences involve only 1%-2% of bilateral investments, but the media has placed unprecedented importance on the rate of their economic incidence. The early warning system is not being disputed, on the contrary, Pascal Lamy outlined to the press that in the case of steel, it had worked perfectly. Mr Lamy even the suggested the possibility of developing a formula for helping US steel to carry out its necessary restructuring: a 2% tax that would have hit not just US products but also European products imported into the USA. Unfortunately, this suggestion, Mr Lamy explained, had been rejected by Washington; there is no problem with the early warning system. Commissioner Lamy considers that this matter and others need to be tackled and resolved by respecting the existing multi-lateral rules in force (but their interpretation is not always clear etc.).
Some worrying areas. In order to complete the whole picture there are some worrying areas that need to be ironed out. Certain trends in US agriculture create cause for concern because while they continue to demand a greater opening up of the European market, on a national level there is evidence of a clear return to state aid with the worst effects of ensuing trade distortion. International mechanisms should perhaps be subject to an overall and thorough re-examination. The document point to other US trends impacting in EU accession candidate countries that seek to remove their special trade conditions, whereas these countries are expected to apply the entire European trade system in the future.
The Summit cannot discuss everything. It is obviously impossible that the President of the USA and the EU Presidents proceed to a full debate on all the key points on Thursday in just a morning! Several of these points are not up for discussion at this level. The Summit and declarations at the end will essentially focus on the most important political subjects of the moment, including the war on terrorism but also on the importance of the will to strengthen and assert the partnership, given that this partnership will never appear as essential as it actually is, apart from when it is threatened. It is in this perspective that the Lamy/Patten document assumes its significance, by effectively offering a major guideline for future developments.
(F.R.)